Anyone want to predict the Real Estate market for the next year? (bank owned, to rent) - Minneapolis - St. Paul - Minnesota (MN) -Twin Cities - City-Data Forum

HarborEastGuy · 12-17-2010, 01:58 PM

Hello all.. What mild spring-like conditions we are having this Dec!

I rent a condo in Highland Park but will be looking to buy within the next
12 months. Anyone want to predict where they think the market is going
6 months, 12 months, 2 years from now?

I'm not looking for the standard "I'm a Realtor and I tell everyone the market
is going up even if its not because I want to earn a commission" type replies.

Min-Chi-Cbus · 12-17-2010, 02:07 PM

Sure, I'll take a stab at it....

6 months: rates slightly higher, prices stable; 90%-105% of the current median
12 months: rates stablizing, prices stable; 95%-105% of the current median
2 years: rates increasing, prices slowly increasing; 100%-110% of the current median

If I were you, I wouldn't rush into buying just because of the market in the next 2 years. You'll still be buying at/near the bottom and possibly right before prices start to recover. I'm in the same boat as you but I won't be purchasing for at LEAST another year or so, and I feel absolutely no pressure to buy before I am comfortable doing so.

golfgal · 12-19-2010, 06:52 AM

If you are buying a house to live in long term, it doesn't really matter what the market will be like. If you are looking for investment properties, winter is always a good time to buy.

BillWallace · 12-19-2010, 07:27 AM

I'm a Realtor - I hope that doesn't disqualify me from answering.

I actually think Min-Chi is in the right range. With interest rates trending up lately that's not a positive factor right now. The other negative I see in the market is that there are still not nearly enough buyers - too many people like you who are nervous about buying. In addition, there is a large pent up backlog of people who "would like" to sell. We're seeing 50%+ of traditional sellers have their listings end up as expired or cancelled meaning there's a backlog of potential sellers just waiting to keep an oversupply of homes out there even if more buyers show up. Therefore, I don't see any meaningful increase in the market in 2011 and it may be down even a little further.

I do also agree with golfgal in that buying a house is not the same as buying stocks. Your goal shouldn't really be to time the market and try to guess when the bottom will be. While that might be part of your decision, buying a home has a lot more intrinsic benefits that accrue that you should be using in your decision process. So if you are buying it as an investment I would maybe look at bank owned properties (those are going at the lowest prices ever right now). If you are looking at a longer term solution that meets your housing goals for some time in the future then it may be a good option depending on your circumstances.

golfgal · 12-19-2010, 07:56 AM

I have to say that the people I know that have bought houses in the past year have had NOTHING but nightmares with the process which is also keeping people from buying.

knke0204 · 12-19-2010, 10:58 AM

Buying a house has always been a chore. It's just most people take forever to do things.

lalife · 12-19-2010, 01:36 PM

Keep renting. Buying a house in this unstable economy just isn't wise. I was recently laid off from a major corporation and the home owners have it the worst because it is harder to "cast a net" when looking for a new job when you own a house. As a renter, I can find a new job, then look for a new place to live if it is too far from where I live now. Twin Cities traffic can be hell, and I ain't gonna waste my life in it. If one owns, you don't usually have that choice if work is far away.

Also, one of my former co-workers took a new job in New Jersey. She said that she will NEVER buy again. She lost about $60,000 when she sold her townhouse.

lalife · 12-19-2010, 01:39 PM

But then again, if you are a doctor or some other type of serious professional with almost guaranteed job security, of course then buying isn't a bad idea. Anyone working for corporate America is disposable tho. With the layoff were $200,000 Marketing VP's and Directors of IT etc.....along with the rest of us.

lalife · 12-19-2010, 01:41 PM

Finally, owning a home is NOT an investment!

golfgal · 12-19-2010, 02:37 PM

Quote:

Originally Posted by knke0204

Buying a house has always been a chore. It's just most people take forever to do things.

Not to this extent. We bought our first home back when you actually had to qualify for a loan vs just needing a heartbeat like we have seen in recent years. It was MUCH easier back then to get a loan then it is now.

Quote:

Originally Posted by lalife

Finally, owning a home is NOT an investment!

Owning a home IS a LONG TERM investment, especially compared to renting anywhere. The problem we have seen recently is that people move too much for it to really pay off LONG TERM. In 30 years our house will be worth significantly more then we paid for it, including any updates we may do over that time. If you rent, you have nothing after 30 years.

Had we stayed in our first home and not been transferred for DH's job, that home, even in this depressed market would be worth 3 times what we paid for it(it was recently put on the market and the asking price is over 3 times what we paid for it). The only thing that has been done to the home since we sold it was new kitchen counters, vinyl flooring and central air. We bought that home 18 years ago. I sure would like my $414 house payment back .